The Public Service Alliance of Canada (PSAC) – Canada’s largest union representing public sector workers – has ceased their strike action for the vast majority of their workers, effective this morning. Shortly after midnight on Monday, the union said a tentative agreement had been reached, and that most workers (except those who work for Canada Revenue Agency) would be expected to be back on the job as of Monday.
The union had been clear in their demands: wage increases, control over telework arrangements, a ban on contracting out work and priority for senior staff. It’s a message that has been on the lips of union members since negotiations began, but one that they argue had not been fully heeded by their employer, the Government of Canada.
Now that a tentative deal has been achieved, let’s take a look back at the 10+ days of labour action that saw an escalation in tensions and rhetoric on both sides during the last week.
A Look at the Negotiations
PSAC first launched into negotiations with the federal government for a new collective bargaining agreement in 2018. That agreement was delayed due to the pandemic and a number of other factors.
PSAC has also been critical of the government’s decision to proceed with a new pay system for public sector employees, known as the Phoenix pay system. The system has been plagued with problems since its implementation in 2016, with some employees not receiving their pay on time, or receiving incorrect amounts. PSAC has called for the system to be scrapped and for employees to be compensated for the stress and financial hardship caused by the Phoenix’s problems.
Leading into the Strike
The situation escalated late last month when the PSAC filed an unfair labour practice complaint with the Public Service Labour Relations and Employment Board. The complaint alleged that the government had failed to negotiate in good faith, and that they had engaged in bad faith bargaining. The union then gave notice to the government that their members would be walking off the job and entering a strike position.
At the heart of the dispute was the percentage that wages should increase. The union initially asked for 13.5 % over three years, saying this was needed to keep up with inflation. Meanwhile, the government had offered a nine per cent increase over three years. While PSAC did adjust their wage increase demand to a lower (undisclosed) amount, they had previously stated that a nine per cent increase would not get a deal done. The specifics of the deal that has been reached, including changes to wages, aren’t yet known.
The government’s position throughout the bargaining process has focused on a message of fiscal responsibility, a central theme in Budget 2023. In an open letter to public servants and Canadians last week, the President of the Treasury Board, Mona Fortia, shared the government’s position. Their view was that the wage increase that they have put forward reflects the recommendation of the third-party Public Interest Commission, endorsed by the PSAC’s own nominee to the Commission.
The government’s narrative centred on the notion that they put a ‘fair deal’ on the table and that PSAC demands were unaffordable and would severely impact the federal government’s ability to deliver services to Canadians. Treasury Board tabled what it styled as their final offer for striking workers late last week.
The Government of Canada may have been keen to pursue a deal in light of public opinion data suggesting public sentiment was not on their side. A recent survey from Angus Reid found that 61% of Canadians support PSAC’s demands, including a 5% pay increase per year. At the same time, the same poll noted 48% of respondents believe that the government is justified in trying to rein in public sector spending. This highlights the complexity of the issue, as the government has argued that declining inflation has reduced the need for pay increases.
Meanwhile, the impacts of the strike on government services had begun to be felt. Last week, Sean Fraser, the Minister of Immigration, warned that the delay has led to citizenship ceremonies being cancelled and an immigration backlog that continues growing, with tens of thousands of applications not being processed. Now that the deadline to file taxes is here, the government has signalled that Canadians’ refunds, which many Canadians rely on this time of year to pay bills, will be delayed because there are no workers to process the returns.
What’s Next?
Information on what the new deal will hold for workers and taxpayers aren’t yet known, and Canada Revenue Agency workers continue to negotiate. Expect opposition parties to press for details of the agreements, and seek to criticize the government for either falling short on workers demands, or giving the union more than the country can afford. But for now, the government can enjoy the absence of downtown protests and media headaches – at least for a few hours.
